FOOD and beverage company RFM Corp. (RFM) disclosed that its board of directors approved on Sept. 1, 2022 a P1.2-billion capital expenditure (capex) plan that will expand the production capacities of the company's milk, consumer and institutional businesses for future growth.

"This [P]1.2 billion capex approval is one of our biggest since our purchase of the Royal pasta brand in 2014. On top of the cash dividends we just declared, we plan to use our excess cash to fund this over the next 15 months. This capex is expected to support the double-digit growth of our Selecta Milk offerings as well as support the growing consumer and institutional businesses," RFM Chief Executive Officer Jose Ma. Concepcion 3rd said.

The RFM's board approved a cash dividend of P200 million or P0.05936 per share in addition to the capex. This has a dividend yield of 6.5 percent at the P3.9 per share prevailing stock price. Its payment date is Oct. 11, 2022 and the record date is Sept. 15, 2022.

RFM reported a 17-percent growth in sales for the first half of 2022, as it was buoyed by its ice cream, milk and institutional businesses. Its net income for the first semester of 2022 did not change as it also amounted to P688 million, which was the same level for 2021.

Concepcion said the company is doubling down its support for the milk and its other high growth segments that will drive the topline of RFM in the next five years.

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"The investment into more production capacity for milk and our other high growth business segments will support RFM's sales growth momentum even as there are uncertainties in the global economy. We have been carefully passing on the cost of higher inputs, and also tightening on expenses to manage our margins," Concepcion said.

He added that their strategy of focusing on core strengths and brands has yielded the expected growth over the past years, and they are planning on deploying the extra cash they have accumulated to further feed into the growth of their core product lines.

RFM Corp. is the maker of Selecta Milk, Royal and Fiesta pasta and sauces, and White King bakery mixes. RFM also holds a 50-percent stake in the Unilever RFM Ice Cream joint venture which manufactures Selecta, Cornetto and Magnum brands.